Financial Review: Ashford Hospitality Prime (AHP) & Its Competitors

Ashford Hospitality Prime (NYSE: AHP) is one of 28 publicly-traded companies in the “Hospitality REITs” industry, but how does it weigh in compared to its peers? We will compare Ashford Hospitality Prime to similar businesses based on the strength of its institutional ownership, earnings, analyst recommendations, valuation, profitability, dividends and risk.

Risk and Volatility

Ashford Hospitality Prime has a beta of 1.17, indicating that its share price is 17% more volatile than the S&P 500. Comparatively, Ashford Hospitality Prime’s peers have a beta of 1.01, indicating that their average share price is 1% more volatile than the S&P 500.

Analyst Recommendations

This is a summary of current ratings and target prices for Ashford Hospitality Prime and its peers, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Ashford Hospitality Prime 0 3 3 0 2.50
Ashford Hospitality Prime Competitors 111 742 854 21 2.45

Ashford Hospitality Prime currently has a consensus price target of $13.40, suggesting a potential upside of 31.24%. As a group, “Hospitality REITs” companies have a potential upside of 4.95%. Given Ashford Hospitality Prime’s stronger consensus rating and higher possible upside, analysts plainly believe Ashford Hospitality Prime is more favorable than its peers.

Profitability

This table compares Ashford Hospitality Prime and its peers’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Ashford Hospitality Prime 4.02% 4.88% 1.20%
Ashford Hospitality Prime Competitors 7.02% 1.66% 1.67%

Earnings and Valuation

This table compares Ashford Hospitality Prime and its peers top-line revenue, earnings per share and valuation.

Gross Revenue EBITDA Price/Earnings Ratio
Ashford Hospitality Prime $407.02 million $100.67 million 28.36
Ashford Hospitality Prime Competitors $1.10 billion $338.63 million -15.32

Ashford Hospitality Prime’s peers have higher revenue and earnings than Ashford Hospitality Prime. Ashford Hospitality Prime is trading at a higher price-to-earnings ratio than its peers, indicating that it is currently more expensive than other companies in its industry.

Insider and Institutional Ownership

69.4% of Ashford Hospitality Prime shares are held by institutional investors. Comparatively, 77.4% of shares of all “Hospitality REITs” companies are held by institutional investors. 10.0% of Ashford Hospitality Prime shares are held by company insiders. Comparatively, 5.4% of shares of all “Hospitality REITs” companies are held by company insiders. Strong institutional ownership is an indication that hedge funds, endowments and large money managers believe a stock will outperform the market over the long term.

Dividends

Ashford Hospitality Prime pays an annual dividend of $0.64 per share and has a dividend yield of 6.3%. Ashford Hospitality Prime pays out 177.8% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. As a group, “Hospitality REITs” companies pay a dividend yield of 5.2% and pay out 132.6% of their earnings in the form of a dividend. Ashford Hospitality Prime has increased its dividend for 2 consecutive years.

Summary

Ashford Hospitality Prime beats its peers on 8 of the 15 factors compared.

Ashford Hospitality Prime Company Profile

Ashford Hospitality Prime, Inc. invests in high revenue per available room (RevPAR), luxury hotels and resorts. The Company conducts its business and owns all of its assets through its operating partnership, Ashford Hospitality Prime Limited Partnership (Ashford Prime OP). The Company operates in the direct hotel investment segment of the hotel lodging industry. As of February 24, 2017, it owned interests in 11 hotel properties in six states, the District of Columbia and St. Thomas, the United States Virgin Islands with 3,702 total rooms, or 3,467 net rooms, excluding those attributable to its joint venture partner. The hotel properties in its portfolio are mainly located in the Unites States urban markets. The Company owns nine of its hotel properties directly, and the remaining two hotel properties through an investment in a majority-owned consolidated entity. All of the hotels in the Company’s portfolio are asset-managed by Ashford Hospitality Advisors LLC.

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